Apple/Samsung Dominance Hits Record

Research in Motion and Microsoft have their fingers crossed hoping that their new mobile operating systems catch on. Consumers should wish them luck.

That’s because the smartphone market is increasingly a duopoly. In the fourth quarter, according to preliminary data from Strategy Analytics, Samsung held a 40% market share in global smartphone unit sales. Runner-up Apple, meanwhile, snagged 30%, giving the top two a combined 70% of the market.

The previous peak for combined market share between the two dominant smartphone players was 53% in the first quarter of 2012. A year prior to that, they held just 30% together.

The duopoly is even more pronounced in terms of operating systems, considering the handful of companies like HTC and Motorola Mobility that, like Samsung, primarily make phones running Google’s Android software.

The history of handsets suggests dominant players can collapse as quickly as their phones go out of fashion. Except this time around, the more dominant the operating systems, the more apps that are written for them.

Comments (5 of 5)

It's not too complicated. BB10 comes out on Wednesday. Are there going to be any line ups? Hmm.

9:35 am January 26, 2013

WhoAreStrategicAnalytics wrote :

Would like more background on SA and how they are able to estimate sales when no one gives out numbers. Also last year they were part of a big controversy as their estimates on Samsung were about 10 millions units greater than the other guys.

It would be great to get some investigative journalism which looks at Strategic Analytics, ComScore, IDC and even guys like ABI Research.

4:39 pm January 25, 2013

kurt wrote :

How many times will rehash the same stats? Everybody gets it...Apple and Android have a huge advantage.

Notice the similarities between RIM circa 2007 and Apple today?

BB10 is a revolutionary OS.

Carriers DO NOT WANT a duopoly and have signed on en masse to carry and PUSH BB10. walmart is even on board.

Anyone who tries a BB10 quickly touts its prowess over other offerings.

as for Apps...RIM has made a huge comeback in attitude and relationship with App Developers...last weekends port-a-thon event ported over 19,000 apps and 15,000 the weekend before. Apps will not be an issue for BB10.

Anyone who got slapped down on Apple long positions should cut and run and pour some money on the next growth opportunity...RIM and BB10.

4:33 pm January 25, 2013

pacman wrote :

Why do I feel like that has been written by a nokia employee?

4:19 pm January 25, 2013

Anonymous wrote :

Nokia is a stock with great upside opportunity and why:

1) Nokia´s bankruptcy is already remote.
Nokia has increased net cash to about $5.7 billion.
Nokia´s worst loss has been $290 million a quarter in 2012.
Even with this kind of loss, Nokia could still deal by its own net cash for at least 4 years!

2) Nokia won´t have to deal with that kind of loss in the future and why

A. Nokia has cut cost expenses. The layoff in 2012 starts to be fully effective in 2013.

B. Now Nokia has to pay royalty to Microsoft, but Nokia has patent incomes.

C. Nokia has managed to make the important tough work for the basis of its new platform WP.
Nokia has already sold over 15 million Lumia phones up to date (9.9 million units from Lumia debut till the end of September 2012 + 4.4 million units in the last quarter of 2012 + January 2013).

D. Nokia has now a high end phone that can make "halo effects" and be compared to Apple´s and Samsung´s most high-end phone, the Lumia 920.
The demand of this phone is still high in many countries around the world. The 4Q12´s Lumia sales did not include the sales of Lumia 920 in many countries, such as India, Asia-Pacific, UAE, Latin America, and many other countries around the world yet, because the phone is arriving these countries only starting from January 2013.
Even in Europe, many countries start to get this phone starting 1Q13, for example the Netherlands announced the phone arriving in January.
And China Mobile received only first lot of Lumias 920T around Christmas, the second and third lot and further have arrived China, and the phone is still selling out.

E. China Mobile deal. When now, both China Mobile and China Unicom are subsidizing the Lumia 920 heavily, the 2-year or 3-year contract is starting from
0 or 1 yuan, and considering only less than 1/5 of Chinese people are using highest-end smartphones,
this will result into a huge number of 2-year or 3-year contract users for Nokia in China! Besides, 3G penetration in China is still very low, there is a huge opportunity there. Additionally, among the highest end phones, Nokia Lumia 920 is significantly much cheaper than for example iPhone 5 and Galaxy Note II. Nokia has an advantage in both the price competition and the biggest carriers´ backing in China!

F. Nokia Siemens Networks (NSN). During these few months NSN has won many 3G and 4G contracts in many countries.
According to NSN, they have network equipment that can boost the speed of 4G many times faster. This shows that, besides PureView camera technology, HD+ sensitive screen technology, advanced mapping platform HERE and City Lens, Nokia has also top innovations in building 4G LTE networks.

G. MWC is coming soon in Febuary. There are still more to come from Nokia.
According to The Verge, Nokia will launched PureView camera phone.
According to CEO Stephen Elop, Nokia is also planning a lot of interesting things with Verizon.
Nokia is likely launching tablet as well, even with some loyal fans of Nokia around the world buying some of Nokia´s tablets, this will be a good gain for Nokia.
Nokia will launch more Lumia phones in the coming months to attract different consumer demands. More lower price-point,
mid-range and high-end WP8 Lumias are to come.

In 1Q13, beside Lumia 920 and Lumia 820 which are making their way to more markets and with better supplies, Nokia is also attracting the mass markets with budget WP phones Lumia 620 and Lumia 505.

F. Asha phones. Asha phones are now selling almost 10 million units a quarter.
Asha phones are affordable and competitive. Asha phones have now more and more smartphone features.
Apart from features like Facebook, Twitter etc. Asha phones
have internet access and access to thousands of Nokia´s most popular apps.
Nokia has also brought an app called "Nearby" into Asha phones. Nearby is almost the same as City Lens in Lumia phones which is exclusive and unique in mapping and location data.
There is still plenty of room for Asha phones to grow, because the price is competitive (cheapest android is right now about $100, while Asha is only about $70 without any contract).
Apart from the features and price mentioned above, there are a couple of important and good selling points in Asha phones against cheapest androids: free games and music!
Asha phones are still profitable for Nokia, because the OS is from Nokia itself, Nokia does not have to pay royalty for it.

3) While bankruptcy is remote, Nokia´s stock price is still heavily undervalued.
NYSE tech stocks are usually 2x book value, Nokia is still way much below that.
According to Morningstar´s valuation, the sum of parts of Nokia (NSN, Navteq, feature phones, smartphones and patent portfolio)
is worth much more than Nokia´s stock price right now, not to mention Nokia´s $5.7 billion net cash added to that value!
Two years ago NOK was still about $15, now the stock is only over $4, the reason is that the stock has been over sold.
Nokia is the most short sold stock in both Helsinki and New York! The shorts are still over 20% in Nokia´s total share number which is approximately 3.75 billion shares.
This is a huge number, considering Apple´s short interest is only around 1% and Samsung´s around 2%. When Nokia is here to stay, the shorts need to be covered and the stock will skyrocket from these levels.

Nokia Apple Intel Microsoft Cirrus Logic
0.32 3.0 2 3.0 3.76
Note that Nokia is currently selling at 0.32 price/sales ratio. This means that if the company manages to restructure and return to normal profitability, the stock has the potential to become a 10x bagger (even from today's price levels) - assuming the market will value Nokia 3.0x sales like Apple or Microsoft. But even a price/sales ratio of 2, like Intel has, means a 6x bagger from these levels.

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